American Express Co. announced plans to reduce its global workforce by approximately 3,500 jobs, representing about 5% of its total 78,000 employees, as part of a broader effort to control rising costs and enhance organizational efficiency. The move was disclosed alongside the company’s release of strong third-quarter earnings and an upward revision of its full-year 2026 profit forecast.
Chief Executive Officer Steve Squeri emphasized the need to make American Express more agile and efficient by streamlining decision-making processes and reducing organizational layers. He attributed the job cuts to this strategic goal rather than solely to technological advancements. However, the broader financial sector has seen similar workforce reductions recently, with firms like Barclays, HSBC, and Citigroup citing the growing adoption of artificial intelligence and technological investments as factors contributing to such measures.
The company has faced increased competition in retaining premium cardholders, prompting it to refresh offerings and enhance benefits. For instance, American Express expanded perks on its Platinum card last year and recently announced a partnership with Airbnb Inc., allowing select luxury rentals to qualify for the cardholders’ annual lodging credit. While these initiatives helped maintain customer engagement, they also led to an approximate 9% rise in operating expenses during the third quarter, totaling $14.5 billion. Notably, expenses related to member rewards increased by 10%, and marketing costs rose 11%.
Despite expense growth, American Express exceeded analysts' profit expectations, reporting adjusted earnings per share of $4.68 in the third quarter compared to the $4.49 average estimate. The company also raised its 2026 earnings guidance to a range of $18.30 to $18.60 per share, up from the previous estimate of $17.30 to $17.90. However, billed business—a key metric that measures credit card and related product transactions—came in slightly below estimates at $454 billion, partly affected by the company’s exit from certain small-business co-brand partnerships.
The company’s results were further bolstered by a $751 million after-tax gain from selling its equity interest in Global Business Travel Group Inc. Part of this gain funded a $253 million after-tax restructuring charge related to efficiency initiatives. These gains and charges were excluded from the adjusted earnings figures.
American Express is also contending with regulatory enforcement actions following allegations of deficiencies in its anti-money-laundering systems by the U.S. Office of the Comptroller of the Currency and the Federal Reserve. The company has agreed to pay a $350 million fine but stated that this penalty will not affect its full-year 2026 financial guidance or its 2027 outlook.
While the job cuts and increased expenses reflect the challenges of balancing growth with cost management in a competitive market, American Express continues to report strong business momentum, driven by robust spending by affluent customers, steady card member retention, and solid credit performance.